TRADE WAR BROUGHT FEAR IN WORLD STOCK MARKETS?

TRADE WAR BROUGHT FEAR IN WORLD STOCK MARKETS?

Trump’s plan to impose 25% tariffs on steel and 10% tariffs on aluminum imports fulfills the president’s promise of tough sanctions but also infuriates countries like China who could retaliate, initiating a trade war. The response to the move was overwhelmingly negative, but abroad and in the US. China and the EU immediately denounced the move US auto makers and oil and gas producers also condemned the tariffs, saying they could get caught in the middle of a nasty trade war if other countries retaliate. In imposing the tariffs, Trump relied on a provision which allows such measures for national security, but clearly, US trading partners will not quietly accept these protectionist measures.

Recent indicators show that inflation in the euro zone is steady, but remains well below the ECB target of around 2 percent. Euro zone consumer price index dipped to 1.2% in February, down from 1.3% in January. Economic growth has rebounded, led by a robust German economy. Still, there is plenty of slack in the euro zone economy and the ECB is not under pressure to tighten policy. The Bank will meet on March 8, and no major changes are expected. Policymakers could deliberate the possibility of removing the Bank’s easing bias towards increasing bond purchases if needed. A removal of the easing bias would likely be interpreted as a plan to tighten policy and would be bullish for the euro.

Like every other country , trump wants boost in production in their country. we can’t deny the fact a weak dollar is good for American industry. for example , coca-cola is an American soft drink producer company , which operates almost every region of the world. They are also operating in India, but ultimately they have to convert their profit into U.S dollar Using Indian Money , if US= Indian rupees is weak It means they are getting more cash in dollars. The same rule apply for Japanese yen , although Japan is developed economy but still their currency counts in one of the weakest currency in the world, even 1 INR = 2 Japanese yen. That is the reason President Trump want weak dollar in order to give to accelerate American companies profit.